The Impact of the Sarbanes-Oxley Act of 2002

The Sarbanes-Oxley Act (SOX) addresses the quality of financial reporting and operations as well as corporate governance, and aims to improve the overall financial information environment by increasing the accuracy and reliability of corporate disclosure. This study investigates security analysts performance following the enactment of SOX. Findings indicate that forecast accuracy has decreased for all firms in the sample. Also, security analysts have become pessimistic in their earnings forecasts post-SOX. The evidence suggests that SOX has not had a positive impact on security analysts performance, which has actually deteriorated post-SOX